Question

WHAT is the nature of poverty in the U.S. today? In a few sentences explain a couple features of poverty in the United States today, including how we measure poverty, who is poor, and the likelihood of people escaping poverty.

WHY are people poor in the U.S. today? Using the three theoretical perspectives critically evaluate the strengths and weaknesses of various theories for the causes of poverty in the contemporary United States.

HOW do we work to reduce poverty? What are some current anti-poverty policies? What new policy would you create to address poverty here in the United States, in your local neighborhood or internationally?

Answer 1

Poverty is a pervasive human condition of being unable to obtain or provide a standard level of food, water and/or shelter. It exists in every country in varying degrees, and it is unlikely to disappear anytime soon. The United States is considered the richest country in the world, and yet millions of its residents live in poverty.

Poverty is measured in two ways – absolute poverty and relative poverty. Absolute poverty looks at the goods and services someone (or a family) cannot obtain. Relative poverty looks at the context of the need, how one social group compares to others. The official method of calculating America’s poverty levels was developed in the 1960s and has not been refined substantially since then, although critics maintain that the government overstates the U.S. poverty level because it counts as impoverished people who in generations past would be considered as not living in poverty.

The tide has been rising fast recently. Thanks to a jump in productivity growth after 1995, America's economy has outpaced other rich countries' for a decade. Its workers now produce over 30% more each hour they work than ten years ago. In the late 1990s everybody shared in this boom. Though incomes were rising fastest at the top, all workers' wages far outpaced inflation.

But after 2000 something changed. The pace of productivity growth has been rising again, but now it seems to be lifting fewer boats. After you adjust for inflation, the wages of the typical American worker—the one at the very middle of the income distribution—have risen less than 1% since 2000. In the previous five years, they rose over 6%. If you take into account the value of employee benefits, such as health care, the contrast is a little less stark. But, whatever the measure, it seems clear that only the most skilled workers have seen their pay packets swell much in the current economic expansion. The fruits of productivity gains have been skewed towards the highest earners, and towards companies, whose profits have reached record levels as a share of GDP.

The face of poverty for most Americans is pictures of families in rundown housing in large cities where the industry has moved away.

The true face of poverty, however, is found in rural areas of the South and Southwest regions of the U.S. where living conditions are even more run down and industry never really started up.

Seven of the 10 states with the highest poverty rates in the U.S. are in the South. That includes Mississippi (20.8% of population below the poverty line); Louisiana (20%), Kentucky (18.5%), West Virginia (17.9%), Arkansas (17.2%), Alabama (17.1%) and Georgia (16%) lead the way.

There are two basic versions of the federal poverty measure: the poverty thresholds (which are the primary version); and the poverty guidelines. The Census Bureau issues the poverty thresholds, which are generally used for statistical purposes for example, to estimate the number of people in poverty nationwide each year and classify them by type of residence, race, and other social, economic, and demographic characteristics. The Department of Health and Human Services issues the poverty guidelines for administrative purposes—for instance, to determine whether a person or family is eligible for assistance through various federal programs.

The "Orshansky Poverty Thresholds" form the basis for the current measure of poverty in the U.S. Mollie Orshansky was an economist working for the Social Security Administration (SSA). Her work appeared at an opportune moment. Orshansky's article was published later in the same year that Johnson declared war on poverty. Since her measure was absolute (i.e., did not depend on other events), it made it possible to objectively answer whether the U.S. government was "winning" this war. The newly formed United States Office of Economic Opportunity adopted the lower of the Orshansky poverty thresholds for statistical, planning, and budgetary purposes in May 1965.

The Bureau of the Budget (now the Office of Management and Budget) adopted Orshansky's definition for statistical use in all Executive departments. The measure gave a range of income cutoffs, or thresholds, adjusted for factors such as family size, sex of the family head, number of children under 18 years old, and farm or non-farm residence. The economy food plan (the least costly of four nutritionally adequate food plans designed by the Department of Agriculture) was at the core of this definition of poverty.